The Most Good You Can Do: How Effective Altruism is Changing Ideas About Living Ethically, by Peter Singer (Yale University Press), $25/£14.99
In The Most Good You Can Do, Peter Singer makes a compelling case for effective altruism, “a philosophy and social movement which applies evidence and reason to working out the most effective ways to improve the world.” The book asks readers to consider non-traditional ways of making the world a better place – doing the most good they can do – such as living modestly in order to give, basing career choices on the extent to which different options help others, or donating an organ, as well as more traditional mechanisms, such as charities and causes. Today, donors decide where to give their money based largely on who asks: a friend, a school, or a church. A connection between the donor and the beneficiary is often present. In the United States, most charitable dollars go to education and religion. But, global need is too great, and philanthropy too important for meeting it, to be flip about how these decisions are made. Through reason, evidence, and metacharities, such as Give Well and Animal Charity Evaluators, effective altruists may improve the ethical decisions that people make and how they carry out their responsibilities to others. Singer challenges the assumption that any kind of altruism deserves moral praise. He persuasively argues that donors should not base their giving decisions on a desire for a warm glow, but should base them on reason and evidence about which charities are most effective.
Singer illustrates the philosophical arguments with inspiring narratives about effective altruists. This contributes to making the book accessible to a wide audience. In the discussion of organisations and causes, the focus is on traditional charities. It is worth asking if, given the goals of effective altruism, traditional charity is the best way to improve the world. There are many philanthropic hybrids that fuse altruism with profit and business acumen, such as impact investing, which purports both to make the world a better place and to sidestep many of the vulnerabilities associated with charity. Effective altruists might be more likely to achieve their goals by investing money in an enterprise that combines social impact with the possibility of creating sustainable businesses.
Impact investing tries to create financial return and social impact, using evidence and measuring results. The Acumen Fund, for example, invests charitable donations in for-profit enterprises located in developing countries that address the needs of poor consumers in the areas of water, health and housing, among others. Donors/investors provide the capital that allows nascent enterprises to launch with an eye to being self-sustaining. The goal is to provide developing countries with enterprises that will meet their needs and ultimately be independent of charity. Impact investing satisfies the effective altruist’s goals of using reason and evidence to make the world a better place, and it can provide altruists with a decent, though not spectacular, return on investment. Furthermore, the potential for return on investment can increase the amount of money that goes into helping others. Many impact investors recycle investment profits into additional impact investing organisations. Thus, they create a virtuous cycle.
Because effective altruists maintain that altruistic intentions are incidental, impact investing, and other hybrids are worth exploring. Once the traditional altruistic intention is lifted from giving, leaving donors free to benefit from their gifts, hybrids may be a more effective alternative to philanthropy as mechanisms that create the most good that can be created. Given the problems associated with traditional philanthropy, impact investing is well worth considering.
In either case, effective altruism is a great improvement on the status quo, and law and policy should be used to nudge donors in its direction. In the United States, donors can receive a tax deduction for donations to qualifying charitable organisations. In 1917 Congress reasoned that because donors relieved the state of a burden it would otherwise have, reciprocation was in order. Unfortunately, the deduction excludes most foreign charities. In a global era, that exclusion is difficult to justify. Effective altruism creates the opportunity to improve the charitable deduction. To incentivise effective altruism, the deduction could be restricted to organisations that pass an effective altruism test (to be created), thus marrying financial incentives with effective altruism and increasing the latter through the former. Since the charitable deduction means that the state and its citizens forfeit funds to which it would otherwise have access to meet social needs, the least that states can demand is that deductible organisations do the most good that can be done. The easier it is to distinguish effective from ineffective charities, the stronger the case is for restricting tax incentives to the most effective charities. After all, ineffective charities don’t relieve the government of a burden and therefore don’t meet the spirit of the deduction. Together, effective altruists and metacharities have created the apparatus needed to make the charitable deduction work in the interests of social need, and to avoid a tax free-for-all.
Singer and other effective altruists are successfully challenging social norms about giving, and this book does an outstanding job of moving that agenda forward.